The conclusion of the current deal will be subject to a settlement between the council and Kier approved at a cabinet meeting.

A new council-owned company known as Bristol Waste Company (BWC) will oversee waste services for the next year while the council assesses long-term options.

There will be a handover period as employees, vehicles, equipment and facilities move across to BWC. The new service is expected to start on 1 August.

Julian Tranter, managing director of Kier’s environmental division, said: “When we acquired May Gurney and took on delivery of the Bristol contract, we recognised the issues being faced by both the client and the operational team, and we believe we have made good progress in improving service delivery.

“We have been working together to review the long-term model of service to find a beneficial solution for both parties, and this has now concluded in agreement to mutually end the contract.”

Bristol mayor George Ferguson said: “We place an increasing emphasis on reuse and recycling, and recognise that using residual waste as an energy source is better than landfill.

“We believe the best way we can do that is to exercise more direct control over our vitally important waste collection and street cleaning services.”

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